The FASB and the IASB are reconsidering the role of uncertainty, or probability, in the definition, recognition, and measurement of liabilities.Existing recognition criteria include a probable future sacrifice of resources; one issue involves the minimum probability level to warrant recognition of an uncertain obligation as a liability.U.S.GAAP does not specify a minimum probability level, although the rule-of-thumb in practice is approximately _____ percent.
A)50
B)60
C)70
D)80
E)90

Question

Quizplus · Accepted Answer

The rule-of-thumb in practice for minimum probability level to warrant recognition of an uncertain obligation as a liability is approximately 80 percent.

The FASB and the IASB Are Reconsidering the Role of Uncertainty